Bitcoin warning 'Exercise Caution':SEC

Overstock.com CEO Patrick Byrne discusses why he was an early believer in bitcoin and how he plans to change the marketplace with blockchain.

The U.S. Securities and Exchange Commission warned Thursday that investors should "exercise caution'' with cryptocurrencies like bitcoin, noting state and federal regulators may not be able to recoup any lostinvestments from illegal actors.

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Many promoters of initial coin offerings (ICOs) and other cryptocurrency investments are not following federal and state securities laws, SEC Chairman Jay Clayton and Commissioners Kara Stein and Michael Piwowar said in a statement.

While regulators are trying to police these quickly growing markets, the SEC urged investors to be vigilant. "The SEC and state securities regulators are pursuing violations, but we again caution you that, if you lose money, there is a substantial risk that our efforts will not result in a recovery of your investment,'' the officials said.